MCC and Jordan Sign U.S. Government Grant to Develop Poverty Reduction Program

Washington, D.C. The United States Governments Millennium Challenge Corporation (MCC) and the Government of the Hashemite Kingdom of Jordan entered into a grant agreement on June 4, 2009 that will provide up to $13.34 million to develop a large-scale MCC Compact program focused on poverty reduction through economic growth. The current grant will finance feasibility studies and environmental and social assessments for water and wastewater network projects, and technical advisors to help negotiate the expansion of an existing wastewater treatment plant.

In February 2009, the Government of Jordan, led by a core team within the Jordanian Prime Ministry, proposed four interrelated investment projects in water delivery and wastewater that, working together, will increase the effective supply of water in populous, urban areas. The proposed investment projects are focused on Zarqa, a dry governorate to the east of the capital. Preliminary analysis suggests that nearly three in ten households in Zarqa consume less than the minimum amount of water considered essential for personal hygiene and food safety by the World Health Organization. Due to shortages of piped water, most households receive water only one or two times per week, and low-income families spend a larger share of their money on water supplied by private tanker trucks and other providers at higher prices.

While this preliminary agreement with the Government of Jordan does not constitute a commitment to sign a Compact agreement, it marks an important milestone in the compact development process. Before the compact can be signed, all proposed projects are subject to MCCs rigorous due diligence process, MCCs Board of Directors must first approve the compact funding, and the U.S. Congress must be notified.

This program development grant builds on a successful partnership between MCC and the Government of Jordan in other key areas. In 2006, Jordan began a $25 million MCC Threshold Program to strengthen local democratic institutions by supporting efforts to broaden public participation in the political and electoral process, increasing government transparency and accountability, and enhancing the efficiency and effectiveness of customs administration. The program has helped Jordan accelerate implementation of its homegrown reform initiatives focused on critical improvements in public administration, civil liberties, infrastructure and the economy.

Millennium Challenge Corporation (MCC), a United States government agency designed to work with developing countries, is based on the principle that aid is most effective when it reinforces good governance, economic freedom and investments in people that promote economic growth and elimination of poverty. For more information visit www.mcc.gov.